El Salvador: Growing Industrial Unrest Due to Insecurity

Businessmen have stated their categorical opposition to statements made by a government official that confuse extortion with the funding of organized crime.

Tuesday, March 8, 2016

The statements by the Technical Secretary of the Presidency of El Salvador, Roberto Lorenzana, against companies in the country that suffer from extortion caused a strong reaction from the private sector, four days after Industrias La Constancia publicly announced that it was suspending operation of its plants because of increasing insecurity and violence.

From a statement issued by the Chamber of Commerce and Industry of El Salvador:

Given the statements made by the technical secretary of the Presidency, who accused companies who are victims of extortion of financing crime, the Chamber of Commerce and Industry of El Salvador states:

- That is totally unacceptable to make victims of extortion responsible for a problem that the government itself has not been able to resolve, despite the considerable resources obtained through taxes and international loans.

- That nearly all sectors of the country are harassed by gangs who extort under threat of death, therefore the accusation of the government official also rests on micro and small entrepreneurs, truckers, professionals, merchants in the informal sector, students, housewives and all of the honest and hardworking population.

- Therefore, and echoing the popular clamor, we demand the authorities, instead of blaming the victims of crime, implement effective strategies to reduce the alarming number of killings and reinstate security in areas dominated by criminal organizations.

More on this topic

More Extortion, Fewer Companies

May 2018

In El Salvador every week at least two companies report that they intend to close down due to the impact of extortion, a problem that, far from being resolved, seems to be getting worse every year.

Representatives from the Chamber of Commerce and Industry of El Salvador (Camarasal), said that the country's employers do not see any significant improvement in the security climate, following the six month extension last April of the extraordinary measures of the Sánchez Cerén administration to try to control crime and insecurity.

Guatemala: Investment in Agriculture Suffering Due to Insecurity

June 2016

The agricultural sector has denounced that some agricultural companies have closed their operations because of the crime wave affecting the country's rural areas.

From a statement issued by the Chamber of Agriculture:

With the increase of violent acts perpetrated against collaborators of agricultural enterprises and their private facilities, enterprises which operate and generate employment within the country, we wish to state that:

Growing Cost of Insecurity in Guatemala

March 2016

Companies have to allocate up to 15% of expenses to security services, as a result of the growing violence in the country.

A company wishing to operate in Guatemala has to allocate between 8 to 15% of its expenses to security in order to keep operating. The figure was provided by Victor Guillen, manager of purchases, imports and exports at Dagas, and published by Elperiodico.com.gt, who revealed that his company earmarked Q250 thousand ($32,000) per month for the security of its plants, trucks and workers.

Another Tax to Pay: Extortion

September 2011

In El Salvador, where the cost of insecurity is equivalent to 12% of GDP, extortion is the main obstacle to economic development.

Crime affecting the country stops economic development and investment, according to the technical secretary of the Presidency, Alex Segovia.

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